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T-Mobile's free stock offer may increase your tax bill

Bill Snyder | July 1, 2016
T-Mobile's novel new stock offer sounds interesting in theory, but the IRS will take a bite out of those 'free' shares, according to finance professionals.

Capital gain tax rates vary according to the tax payer's overall tax rate and the length of time they hold the stock before its sale. If it's sold it in less than 366 days, its owner pays a much higher rate than if they wait a year and a day. For what it's worth, T-Mobile shares were priced at $43.74 on Tuesday, so customers are not likely to make significant money on the deal unless they refer a lot of friends. Customers must also open brokerage accounts to hold the shares, but T-Mobile will provide free accounts at its brokerage partner, LOYAL3.

T-Mobile's other thank you gifts are less complicated and not likely to cause tax headaches. For example, customers can carry out one free medium two-topping Domino's pizza, a free small Wendy's Frosty and a free movie rental from VUDU, Walmart's video on-demand service. The company says it will also give away more gifts every Tuesday.

To get any of these goodies, customers must download T-Mobile new "Tuesday" app, but the company's servers were apparently overwhelmed on the first day of the promotion. T-Mobile promised to get them up and running as soon as possible.

Source: CIO.com

 

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